North Carolina Bars Local Employment Requirements

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By Andrew M. Ballard

March 24 — Local governments in North Carolina are prohibited from requiring private employers or contractors to meet wage or benefit requirements not mandated by the state, under a bill signed into law by Gov. Pat McCrory (R) March 23.

The new law came in reaction to an ordinance issued by the city of Charlotte and also bans municipalities from providing discrimination protections to classes of people not covered under state law. The legislation took effect upon McCrory's signature and supersedes any existing local ordinance, resolution, regulation or policy previously adopted.

Supporters of the measure said it was aimed at providing consistent requirements for businesses throughout North Carolina. Opponents argued that it takes away local control and treats certain citizens unfairly.

Charlotte enacted its ordinance in February. The city already refused to do business with employers that discriminated in hiring and other areas on several bases. But the ordinance added sexual orientation and gender identity to the list of protected characteristics. The measure was set to become effective April 1 .

A part of the ordinance that allowed transgender people to use the restroom of their choice drew particular attention, and the North Carolina's legislative leadership convened a special session aimed at overturning the city's new requirements.

Lawmakers Acted Fast

H.B. 2 was introduced March 23 and passed the Legislature the same day. The legislation not only addressed the use of bathrooms and changing facilities, but also included provisions aimed at “statewide consistency in laws related to employment and contracting,” declaring employment discrimination to be of statewide concern.

The measure was approved by the state House of Representatives on a vote of 82-16, and passed the Senate unanimously, with all 11 Democrats present not voting. McCrory signed the measure later that evening.

“The basic expectation of privacy in the most personal of settings, a restroom or locker room, for each gender was violated by government overreach and intrusion by the mayor and city council of Charlotte,” the governor said in a statement announcing he had signed the bill.

“While local municipalities have important priorities working to oversee police, fire, water and sewer, zoning, roads, and transit, the mayor and city council took action far out of its core responsibilities,” according to McCrory. “Although other items included in this bill should have waited until regular session, this bill does not change existing rights under state or federal law,” he said.

AFL-CIO Says Local Control Impinged Upon

In a statement provided to Bloomberg BNA March 24, the North Carolina branch of the AFL-CIO said state lawmakers were “taking away the ability of any local jurisdiction to require employers—even those with whom they are contracting—to provide higher wages, safer workplaces, more generous benefits like paid leave, or any other safeguards for workers above and beyond the low-bar the legislature itself deems appropriate.”

The state AFL-CIO said that North Carolina and Mississippi are now the only states “without any state law protecting private sector employees from workplace discrimination on the basis of race, gender, age or disability.”

Several advocacy groups have pledged to sue over the legislation.

Wage Impact Overblown?

Scott Mooneyham, spokesman for the North Carolina League of Municipalities, said his group opposed H.B. 2 and other measures that preempt local decision-making and that undermine the political power of local residents.

But the impact of the new law's wage and hour provisions has been “overblown,” Mooneyham told Bloomberg BNA March 24.

He said the new law doesn't affect the many “living wage” ordinances covering the pay of municipal employees in the state. In addition, he said, North Carolina cities have been prohibited from putting wage requirements into vendor contracts since 2013 and no city in the state has a minimum wage law that affects private employers.

To contact the reporter on this story: Andrew M. Ballard in Raleigh, N.C., at aballard@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

For More Information

Text of H.B. 2 is available at http://src.bna.com/dzJ.